Organizational behavior and development by S. Robbins T. Judge E. Hasham


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Organizational behavior and development by S. Robbins T. Judge E. Hasham

  1. 1. This textbook is accompanied by MyManagementLab, a powerful online tool that combines assessment, reporting, and personalized study to help both students and instructors succeed. With its abundant collection of resources, MyManagementLab offers students many ways to study, and instructors many ways to save time—all in one convenient place. Inside all new copies of this textbook is a pre-paid access code that students can use to access MyManagementLab at This edition of Organizational Behavior provides students in the Arab region with an up-to-date and culturally aware analysis of key areas of organizational behavior, including women in business, intercultural management, conflict management, family business, ethics, and employee relations. This book presents Arab students of organizational behavior with a reference point that uses individuals and organizations that they are familiar with, including Byblos Bank, Intercontinental Hotels, Sanita, Aramex, Saudi Aramco, Sabic, Etisalat, and many more. Through this book, Arab learners will come to understand that organizational behavior theory is applicable and relevant not only to large, multi-national firms but also to their local business environments and workplaces. RobbinsJudgeHasham ArabWorld Edition Organizational Behavior Organizational BehaviorStephen T. Robbins Timothy A. Judge Elham S. Hasham
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  4. 4. Organizational Behavior Arab World Edition STEPHEN P. ROBBINS San Diego State University TIMOTHY A. JUDGE University of Florida ELHAM S. HASHAM Notre Dame University, Lebanon A01_ROBB9658_15_SE_FM.indd 3 7/31/12 5:48 PM
  5. 5. Acquisitions Editor: Rasheed Roussan Senior Development Editor: Sophie Bulbrook Editor: Fay Gibbons Copy-editor: Valerie Bingham Proofreaders: Sylvia Worth, Peter Gill Design Manager: Sarah Fach Permissions Editor: Sarah Deakin Picture Researchers: Alison Prior, Zo Naciri Indexer: Indexing Specialists (UK) Ltd Marketing Manager: Sue Mainey Production Controller: Christopher Crow Cover Designer: Sarah Fach Typesetter: Graphicraft Typeface: ITC New Baskerville Std 10.5pt/12pt Printed in China Pearson Education Limited Edinburgh Gate Harlow Essex CM20 2JE England and Associated Companies throughout the world The rights of Stephen Robbins, Timothy Judge, and Elham Hasham to be identified as authors of this work have been asserted by them in accordance with the Copyright, Designs and Patents Act 1988. Authorized adaptation from the United States edition, entitled Organizational Behavior, 13th Edition, ISBN: 0136007171 by Robbins, Stephen P.; Judge, Timothy A., published by Pearson Education, Inc, publishing as Prentice Hall, Copyright © 2009 All rights reserved. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording or by any information storage retrieval system, without permission from Pearson Education, Inc. This Arab World adaptation edition published by Pearson Education Ltd, Copyright © 2012. All trademarks used herein are the property of their respective owners. The use of any trademark in this text does not vest in the author or publisher any trademark ownership rights in such trademarks, nor does the use of such trademarks imply any affiliation with or endorsement of this book by such owners. Pearson Education is not responsible for the content of third-party internet sites. Credits and acknowledgments for material borrowed from other sources and reproduced, with permission, in this textbook appear on the appropriate page within the text, in the endnotes, or on page 527. 20  19  18  17  16  15  14  13  12  11 IMP  10  9  8  7  6  5  4  3  2  1 ISBN: 978-1-4082-5965-8 A01_ROBB9658_15_SE_FM.indd 4 7/31/12 5:48 PM
  6. 6. To my mother, Juliet, my father, Said, and my brothers, Francois and Anthony: Thank you, and thank God. —Elham S. Hasham A01_ROBB9658_15_SE_FM.indd 5 7/31/12 5:48 PM
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  8. 8. vii About the Authors Stephen P. Robbins Education Ph.D. University of Arizona Professional Experience Academic Positions:  Professor, San Diego State University, Southern Illinois University at Edwardsville, University of Baltimore, Concordia University in Montreal, and University of Nebraska at Omaha. Research:  Research interests have focused on conflict, power, and politics in organizations, behavioral decision making, and the development of effective interpersonal skills. Books Published:  World’s best-selling author of textbooks in both manage- ment and organizational behavior. His books have sold more than six million copies, have been translated into 20 languages, and editions have been adapted for Canada, Australia, South Africa, and India. These include l Essentials of Organizational Behavior, 10th ed. (Prentice Hall, 2010) l Management, 11th ed., with Mary Coulter (Prentice Hall, 2011) l Human Resource Management, 10th ed., with David DeCenzo (Wiley, 2010) l Prentice Hall’s Self-Assessment Library 3.4 (Prentice Hall, 2010) l Fundamentals of Management, 7th ed., with David DeCenzo and Mary Coulter (Prentice Hall, 2011) l Supervision Today!, 6th ed., with David DeCenzo (Prentice Hall, 2010) l Training in Interpersonal Skills, 6th ed., with Phillip Hunsaker (Prentice Hall, 2011) l Managing Today!, 2nd ed. (Prentice Hall, 2000) l Organization Theory, 3rd ed. (Prentice Hall, 1990) l The Truth About Managing People, 2nd ed. (Financial Times/Prentice Hall, 2008) l Decide and Conquer: Make Winning Decisions and Take Control of Your Life (Financial Times/Prentice Hall, 2004). Other Interests In his ‘other life,’ Dr. Robbins actively participates in masters’ track competition. Since turning 50 in 1993, he has won 22 national championships and 14 world titles. He is the current world record holder at 100 meters (12.37 seconds) and 200 meters (25.20 seconds) for men 65 and over. A01_ROBB9658_15_SE_FM.indd 7 7/31/12 5:48 PM
  9. 9. viii About the Authors Timothy A. Judge Education Ph.D. University of Illinois at Urbana-Champaign Professional Experience Academic Positions:  Matherly-McKethan Eminent Scholar in Management, Warrington College of Business Administration, University of Florida; Stanley M. Howe Professor in Leadership, Henry B. Tippie College of Business, University of Iowa; Associate Professor (with tenure), Department of Human Resource Studies, School of Industrial and Labor Relations, Cornell University; Lecturer, Charles University, Czech Republic, and Comenius University, Slovakia; Instructor, Industrial/Organizational Psychology, Department of Psychology, University of Illinois at Urbana-Champaign. Research:  Dr. Judge’s primary research interests are in (1) personality, moods, and emotions, (2) job attitudes, (3) leadership and influence behaviors, and (4) careers (person-organization fit, career success). Dr. Judge has published more than 120 articles in these and other major topics in journals such as Journal of Organizational Behavior, Personnel Psychology, Academy of Management Journal, Journal of Applied Psychology, European Journal of Personality, and European Journal of Work and Organizational Psychology. Fellowship:  Dr. Judge is a fellow of the American Psychological Association, the Academy of Management, the Society for Industrial and Organizational Psychology, and the American Psychological Society. Awards:  In 1995, Dr. Judge received the Ernest J. McCormick Award for Distinguished Early Career Contributions from the Society for Industrial and Organizational Psychology, and in 2001, he received the Larry L. Cummings Award for mid-career contributions from the Organizational Behavior Division of the Academy of Management. In 2007, he received the Professional Practice Award from the Institute of Industrial and Labor Relations, University of Illinois. Books Published:  H. G. Heneman III, and T. A. Judge, Staffing Organizations, 6th ed. (Madison, WI: Mendota House/Irwin, 2009). Other Interests Although he cannot keep up (literally!) with Steve’s accomplishments on the track, Dr. Judge enjoys golf, cooking and baking, literature (he’s a particular fan of Thomas Hardy, and is a member of the Thomas Hardy Society), and keeping up with his three children, who range in age from 7 to 21. A01_ROBB9658_15_SE_FM.indd 8 7/31/12 5:48 PM
  10. 10. About the Authors ix Elham S. Hasham Education Ph.D. Educational Leadership, Management & Administration, University of Leicester, England Professional Experience Professional and Academic Positions:  At Notre Dame University, Lebanon, Dr Hasham is currently an Associate Professor, Coordinator of undergraduate and graduate courses and Graduate Advisor. She previously held posts as Dean of Students (North Lebanon Campus), Director of Admissions and International Recruitment, and Acting Director of Tests and Measurements. Dr Elham is also CEO of Australian Consulting Engineers and Architects (ACEA), and Australian Lebanese Design Services (ALDS); and Coordinator of a Human Resource Management Program, Master of International Business, which is a joint ven- ture between Notre Dame University, Lebanon and Bordeaux University, Paris. Research:  Dr. Hasham’s research interests include Organizational Behavior, Business Ethics, Intercultural Communication and Management, Global Human Resource Management, Leadership and Quality Decision Making, Entrepre­ neurship, Strategic Management, Marketing and Business Policy Strategy. She has presented numerous papers at both regional and international conferences, resulting in publications in refereed journals and conference proceedings, and has written a variety of articles and case studies for a number of books published by Pearson Education. Memberships:  Dr. Hasham is a member of various prestigious associations and organizations such as the Lebanese League of Women in Business (LLWB); the Human Resource Association of Lebanon (HRAL); the Notre Dame University Education Society; the International Association of Universities (IAU); NAFSA: Association of International Educators; and the European Association of International Educators (EAIE). Other Interests Dr. Hasham is interested in all activities that can develop her intellectual, spir- itual, physical, and social status. She is a people’s person and has excellent interpersonal skills that have contributed to a worldwide network. She also enjoys reading, music, tennis, swimming, and nature in general. Dr. Hasham is an advocate of participative management and believes that we need human capital, and must invest in people, to receive the performance and productivity that we seek as leaders. A01_ROBB9658_15_SE_FM.indd 9 7/31/12 5:48 PM
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  12. 12. xi Brief Contents Foreword  xxix Preface  xxxi Acknowledgments  xxxv 1 Introduction    1  What Is Organizational Behavior?  3 2 The Individual    2  Foundations of Individual Behavior: Personality and Values  37   3  Attitudes and Job Satisfaction  69   4  Perception and Individual Decision Making  89   5  Motivation: Concepts and Applications  113   6  Emotions and Moods  151 3 The Group    7  Foundations of Group Behavior  177   8  Understanding Work Teams  205   9  Communication  229 10  Leadership  257 11  Power and Politics  289 12  Conflict and Negotiation  315 A01_ROBB9658_15_SE_FM.indd 11 7/31/12 5:48 PM
  13. 13. xii Brief Contents 4 The Organization System  13  Foundations of Organizational Structure  341 14  Organizational Culture  365 15  Human Resource Policies and Practices in the Arab World  389 5 Organization Dynamics  16  Organizational Change and Stress Management  419 17  Organizational Behavior in the Family Business  447 6 Specifics in OB  18 Intercultural Management: The Significance to Organizational Behavior  471 19  Female Entrepreneurs in the Arab World  491 Appendix A    Research in Organizational Behavior  509 Comprehensive Cases  516 Credits  527 Endnotes  528 Glossary  570 Index  582 A01_ROBB9658_15_SE_FM.indd 12 7/31/12 5:48 PM
  14. 14. xiii Contents Foreword  xxix Preface  xxxi Acknowledgments  xxxv 1 Introduction  1 What Is Organizational Behavior?  3 The Importance of Interpersonal Skills  4 What Managers Do  5 Management Functions  5  •  Management Roles  6  •  Management Skills  8  •  Effective Versus Successful Managerial Activities  8  •  A Review of the Manager’s Job  9 This Is Organizational Behavior  10 Complementing Intuition with Systematic Study  10 Disciplines That Contribute to OB  12 Psychology  13  •  Social Psychology  13  •  Sociology  14  •  Anthropology  14 There Are Few Absolutes in OB  14 Challenges and Opportunities for OB  14 The Significance of Globalization  15  •  Managing Workforce Diversity  16  •  Improving Quality and Productivity  18  •  Improving Customer Service  19  •  Improving People Skills  19  •  Stimulating Innovation and Change  20  •  Helping Employees Balance Work–Life Conflicts  20  •  Creating a Positive Work Environment  21  •  Improving Ethical Behavior  22 Developing an OB Model  23 An Overview  23  •  The Dependent Variables  24  •  The Independent Variables  27  •  Toward a Contingency OB Model  28 Global Implications  30 Summary and Implications for Managers  30 Self-Assessment Library  How Much Do I Know About Organizational Behavior?  4 OB in the News  Other Disciplines Make Use of OB Concepts  13 International OB  Organizational Citizenship at Byblos Bank  26 Point/Counterpoint  In Search of the Quick Fix  31 A01_ROBB9658_15_SE_FM.indd 13 7/31/12 5:48 PM
  15. 15. xiv Contents Questions for Review  31 Discussion Exercise  A Day in the Life of Hussam  32 Ethical Considerations  32 Critical Analysis  Equal Opportunity at Crepaway  33 Research Exercise  33 2 The Individual  2 Foundations of Individual Behavior: Personality and Values  37 Ability  38 Intellectual Abilities  38  •  Physical Abilities  39 Biographical Characteristics  41 Age  41  •  Gender  42  •  Race  43  •  Tenure  43 Learning  44 A Definition of Learning  44  •  Theories of Learning  45  •  Shaping: A Managerial Tool  47 Personality  50 What Is Personality?  50  •  Measuring Personality  51  •  The Myers-Briggs Type Indicator  52  •  The Big Five Personality Model  53  •  Other Personality Traits Relevant to OB  54 Values  58 The Importance of Values  58 The Relationship Between an Individual’s Personality and the Workplace  59 Person–Job Fit  59  •  Person–Organization Fit  60 Linking Cultures and Behavior  60 Hofstede’s Framework for Assessing Cultures  61  •  The GLOBE Framework for Assessing Cultures  62 Global Implications  62 Intellectual Abilities  62  •  Biographical Characteristics  62  •  Learning  63  •  Personality  63  •  Values  63 Summary and Implications for Managers  63 Self-Assessment Library  What’s My Attitude Toward Achievement?  38 International OB  Cultural Intelligence Is Necessary  40 OB in the News  Whatever Men Can Do, Women Can Also Do  44 Self-Assessment Library  How Good Am I at Disciplining Others?  48 Point/Counterpoint  All Human Behavior is Learned  65 A01_ROBB9658_15_SE_FM.indd 14 7/31/12 5:48 PM
  16. 16. Contents xv Questions for Review  65 Discussion Exercise  66 Ethical Considerations  66 Critical Analysis  Qatar: A Country with a Vision  66 Research Exercise  67 3 Attitudes and Job Satisfaction  69 Attitudes  70 What Are the Main Components of Attitudes?  70  •  Is There a Relationship Between Behavior and Attitudes?  71  •  What Are the Major Job Attitudes?  73 Job Satisfaction  77 Measuring Job Satisfaction  77  •  How Satisfied Are People in Their Jobs?  77  •  What Causes Job Satisfaction?  78  •  The Impact of Satisfied and Dissatisfied Employees on the Workplace  80 Global Implications  83 Is Job Satisfaction Specific to Cultures?  83  •  Are Employees in Western Cultures More Satisfied with Their Jobs Than Those in the East?  83 Summary and Implications for Managers  84 Self-Assessment Library  How Satisfied Am I With My Job?  70 International OB  Organizational Commitment at Aramex  74 Self-Assessment Library  Am I Engaged?  76 OB in the News  Job Satisfaction: Does It Differ Across Cultures?  76 Point/Counterpoint  Managers Can Create Satisfied Employees  85 Questions for Review  85 Discussion Exercise  86 Ethical Considerations  86 Critical Analysis  Job Satisfaction in the UAE  86 Research Exercise  87 4 Perception and Individual Decision Making  89 What Is Perception?  90 Factors That Influence Perception  90 Person Perception: Making Judgments About Others  91 Attribution Theory  91  •  Frequently Used Shortcuts in Judging Others  93  •  Specific Applications of Shortcuts in Organizations  94 The Link Between Perception and Individual Decision Making  95 Decision Making in Organizations  96 The Rational Model, Bounded Rationality, and Intuition  96  •  Common Biases and Errors in Decision Making  97 A01_ROBB9658_15_SE_FM.indd 15 7/31/12 5:48 PM
  17. 17. xvi Contents Influences on Decision Making: Individual Differences and Organizational Constraints  100 Individual Differences  100  •  Organizational Constraints  102 What About Ethics in Decision Making?  103 Three Ethical Decision Criteria  103  •  Improving Creativity in Decision Making  104 Global Implications  106 Summary and Implications for Managers  107 Self-Assessment Library  What’s My Attitude Toward Older People?  90 International OB  How Culture Influences Decision Making  98 Self-Assessment Library  Am I a Deliberate Decision Maker?  100 OB in the News  inJAz Bahrain’s Business Ethics Program  101 Self-Assessment Library  How Creative Am I?  106 Point/Counterpoint  When In Doubt, Do!  109 Questions for Review  109 Discussion Exercise  109 Ethical Considerations  110 Critical Analysis  Decision Making Processes at Steel Inc.  110 Research Exercise  111 5 Motivation: Concepts and Applications  113 Defining Motivation  114 Early Theories of Motivation  115 Hierarchy of Needs Theory  115  •  Theory X and Theory Y  116  •  Two-Factor Theory  117  •  McClelland’s Theory of Needs  118 Contemporary Theories of Motivation  118 Cognitive Evaluation Theory  119  •  Goal-Setting Theory  121  •  Self-Efficacy Theory  123  •  Reinforcement Theory  124  •  Equity Theory  125  •  Expectancy Theory  128 Motivating by Job Design: The Job Characteristics Model  129 The Job Characteristics Model  129  •  How Can Jobs Be Redesigned?  131  •  Alternative Work Arrangements  133 Employee Involvement  136 Examples of Employee Involvement Programs  136  •  Linking Employee Involvement Programs and Motivation Theories  137 Using Rewards to Motivate Employees  137 What to Pay: Establishing a Pay Structure  138  •  How to Pay: Rewarding Individual Employees through Variable-Pay Programs  138  •  Flexible Benefits: Developing a Benefits Package  140  •  Intrinsic Rewards: Employee Recognition Programs  141 Global Implications  144 Summary and Implications for Managers  146 A01_ROBB9658_15_SE_FM.indd 16 7/31/12 5:48 PM
  18. 18. Contents xvii Self-Assessment Library  How Confident Am I in My Abilities to Succeed?  114 International OB  Motivation and Culture: What’s the Relationship?  120 Self-Assessment Library  What Are My Course Performance Goals?  122 OB in the News  What Motivates Employees?  126 Self-Assessment Library  What’s My Job’s Motivating Potential?  128 Point/Counterpoint  Praise Motivates  147 Questions for Review  147 Discussion Exercise  148 Ethical Considerations  148 Critical Analysis  Reducing Travel Costs at Applebee’s  148 Research Exercise  149 6 Emotions and Moods  151 What Are Emotions and Moods?  152 The Basic Emotions  154  •  The Basic Moods: Positive and Negative Affect  155  •  The Function of Emotions  156  •  Sources of Emotions and Moods  157 Emotional Labor  160 Affective Events Theory  161 Emotional Intelligence  162 The Case for EI  163  •  The Case Against EI  164 OB Applications of Emotions and Moods  165 Selection  165  •  Decision Making  165  •  Creativity  166  •  Motivation  166  •  Leadership  167  •  Negotiation  167  •  Customer Service  168  •  Job Attitudes  168  •  Deviant Workplace Behaviors  168  •  How Managers Can Influence Moods  168 Global Implications  169 Does the Degree to Which People Experience Emotions Vary Across Cultures?  169  •  Do Peoples’ Interpretations of Emotions Vary Across Cultures?  170  •  Do the Norms for the Expression of Emotions Differ Across Cultures?  170 Summary and Implications for Managers  170 Self-Assessment Library  How Are You Feeling Right Now?  152 Self-Assessment Library  What’s My Affect Intensity?  157 International OB  Emotional Recognition: Universal or Culture Specific?  159 Self-Assessment Library  What’s My Emotional Intelligence Score?  165 OB in the News  Crying at Work Gains Acceptance  169 Point/Counterpoint  The Costs and Benefits of Organizational Display Rules  172 Questions for Review  172 Discussion Exercise  173 Ethical Considerations  173 Critical Analysis  Happiness: Just an Emotion!  173 Research Exercise  174 A01_ROBB9658_15_SE_FM.indd 17 7/31/12 5:48 PM
  19. 19. xviii Contents 3 The Group  7 Foundations of Group Behavior  177 Defining and Classifying Groups  178 Stages of Group Development  180 The Five-Stage Model  180  •  An Alternative Model for Temporary Groups with Deadlines  181 Group Properties: Roles, Norms, Status, Size, and Cohesiveness  181 Group Property 1: Roles  181  •  Group Properties 2 and 3: Norms and Status  184  •  Group Property 4: Size  189  •  Group Property 5: Cohesiveness  190 Group Decision Making  191 Groups versus the Individual  192  •  Groupthink and Groupshift  193  •  Group Decision Making Techniques  195 Global Implications  197 Summary and Implications for Managers  198 Self-Assessment Library  What’s My Attitude Toward Working in Groups?  178 Self-Assessment Library  Do I Trust Others?  184 International OB  Group Cohesiveness Across Cultures  191 OB in the News  Groupthink for an Enron Jury?  194 Point/Counterpoint  Are Groups the Best Design?  200 Questions for Review  201 Discussion Exercise  201 Ethical Considerations  201 Critical Analysis  If Two Heads Are Better than One, Are Four Even Better?  201 Research Exercise  202 8 Understanding Work Teams  205 Why Have Teams Become So Popular?  206 Differences between Groups and Teams  207 Types of Teams  208 Problem-Solving Teams  208  •  Self-Managed Work Teams  209  •  Cross-Functional Teams  209  •  Virtual Teams  210 Creating Effective Teams  211 Context: What Factors Determine whether Teams Are Successful  211  •  Team Composition  213  •  Work Design  217  •  Team Processes  217 Turning Individuals into Team Players  219 Beware! Teams Aren’t Always the Answer  221 Global Implications  222 A01_ROBB9658_15_SE_FM.indd 18 7/31/12 5:48 PM
  20. 20. Contents xix Summary and Implications for Managers  223 Self-Assessment Library  How Good Am I at Building and Leading a Team?  206 International OB  Global Virtual Teams  210 OB in the News  Surgical Teams Lack Teamwork  213 Self-Assessment Library  What Is My Team Efficacy?  219 Point/Counterpoint  Sports Teams Are Good Models for Workplace Teams  224 Questions for Review  225 Discussion Exercise  225 Ethical Considerations  225 Critical Analysis  Team Effectiveness in Egypt  226 Research Exercise  226 9 Communication  229 Functions of Communication  230 The Communication Process  231 Direction of Communication  232 Downward Communication  232  •  Upward Communication  233  •  Lateral Communication  233 Interpersonal Communication  234 Oral Communication  234  •  Written Communication  235  •  Nonverbal Communication  236 Organizational Communication  237 Formal Small-Group Networks  237  •  The Grapevine  238  •  Electronic Communications  239  •  Knowledge Management  243 Choice of Communication Channel  245 Barriers to Effective Communication  246 Filtering  246  •  Selective Perception  246  •  Information Overload  247  •  Emotions  247  •  Language  247  •  Communication Apprehension  247  •  Gender Differences  248  •  ‘Politically Correct’ Communication  248 Global Implications  249 Cultural Barriers  249  •  Cultural Context  250  •  A Cultural Guide  251 Summary and Implications for Managers  252 Self-Assessment Library  What’s My Face-to-Face Communication Style?  230 International OB  Cultural Differences in Oral Communication  235 OB in the News  Communication in the Arab World  244 International OB  Lost in Translation?  250 Self-Assessment Library  How Good Are My Listening Skills?  252 Point/Counterpoint  Keep It a Secret  253 Questions for Review  253 Discussion Exercise  254 Ethical Considerations  254 Critical Analysis  The Limitations of Electronic Communication  254 Research Exercise  255 A01_ROBB9658_15_SE_FM.indd 19 7/31/12 5:48 PM
  21. 21. xx Contents 10 Leadership  257 What Is Leadership?  259 Trait Theories  260 Behavioral Theories  261 Ohio State Studies  262  •  University of Michigan Studies  262  •  Summary of Trait Theories and Behavioral Theories  262 Contingency Theories: Fiedler Model and Situational Leadership Theory  263 Fiedler Model  263  •  Hersey and Blanchard’s Situational Theory  265  •  Path-Goal Theory  265  •  Path-Goal Variables and Predictions  266  •  Summary of Contingency Theories  267 Leader–Member Exchange (LMX) Theory  267 Decision Theory: Vroom and Yetton’s Leader-Participation Model  268 Inspirational Approaches to Leadership  268 Charismatic Leadership  269  •  Transformational Leadership  271 Authentic Leadership: Ethics and Trust Are the Foundation of Leadership  274 What Is Authentic Leadership?  275  •  Ethics in Leadership and Corporate Social Responsibility  275  •  What Is Trust?  276  •  Trust and Leadership  276  •  Three Types of Trust  277  •  Basic Principles of Trust  277 Contemporary Leadership Roles  278 Mentoring  278  •  Self-Leadership  279  •  Online Leadership  279 Challenges to the Leadership Construct  280 Leadership as an Attribution  280  •  Substitutes for and Neutralizers of Leadership  281 Finding and Creating Effective Leaders  282 Selecting Leaders  282  •  Training Leaders  282 Global Implications  283 Summary and Implications for Managers  284 Self-Assessment Library  What’s My Leadership Style?  258 OB in the News  Riding the Waves Requires Leadership Skill!  261 Self-Assessment Library  What Is My LPC Score?  264 Self-Assessment Library  How Charismatic Am I?  269 Self-Assessment Library  Am I an Ethical Leader?  275 International OB  Cultural Variation in Charismatic Attributions  280 Point/Counterpoint  Leaders Are Born, Not Made  286 Questions for Review  286 Discussion Exercise  287 Ethical Considerations  287 Critical Analysis  Cultural Variation in Charismatic Attributions  287 Research Exercise  287 A01_ROBB9658_15_SE_FM.indd 20 7/31/12 5:48 PM
  22. 22. Contents xxi 11 Power and Politics  289 A Definition of Power  290 Contrasting Leadership and Power  291 Bases of Power  291 Formal Power  291  •  Personal Power  292  •  Which Bases of Power Are Most Effective?  293 Dependency: The Key to Power  294 What Creates Dependency?  294 Power Tactics  295 Sexual Harassment: Unequal Power in the Workplace  297 Politics: Power in Action  299 Definition of Organizational Politics  299  •  The Reality of Politics  300 Causes and Consequences of Political Behavior  301 Factors Contributing to Political Behavior  301  •  How Do People Respond to Organizational Politics?  304  •  Impression Management  306 The Ethics of Behaving Politically  308 Global Implications  309 Politics Perceptions  309  •  Preference for Power Tactics  309  •  Effectiveness of Power Tactics  310 Summary and Implications for Managers  310 Self-Assessment Library  Is My Workplace Political?  290 International OB  Influence Tactics in China  297 Self-Assessment Library  How Good Am I at Playing Politics?  306 OB in the News  Excuses Are Everywhere  308 Point/Counterpoint  Managing Impressions Is Unethical  311 Questions for Review  311 Discussion Exercise  312 Ethical Considerations  312 Critical Analysis  The Politics of Backstabbing  312 Research Exercise  313 12 Conflict and Negotiation  315 A Definition of Conflict  316 Transitions in Conflict Thought  317 The Traditional View of Conflict  317  •  The Human Relations View of Conflict  317  •  The Interactionist View of Conflict  317 The Conflict Process  318 Stage I: Potential Opposition or Incompatibility  318  •  Stage II: Cognition and Personalization  320  •  Stage III: Intentions  321  •  Stage IV: Behavior  322  •  Stage V: Outcomes  322 A01_ROBB9658_15_SE_FM.indd 21 7/31/12 5:48 PM
  23. 23. xxii Contents Negotiation  325 Bargaining Strategies  325  •  The Negotiation Process  328  •  Individual Differences in Negotiation Effectiveness  329  •  Third-Party Negotiations  331 Global Implications  333 Conflict and Culture  333  •  Cultural Differences in Negotiations  333 Summary and Implications for Managers  334 Self-Assessment Library  What’s My Preferred Conflict-Handling Style?  316 Self-Assessment Library  What’s My Negotiating Style?  331 International OB  Negotiating Across Cultures  331 OB in the News  ‘Marriage Counseling’for the Top Bosses  332 Point/Counterpoint  Conflict Benefits Organizations  336 Questions for Review  336 Discussion Exercise  337 Ethical Considerations  337 Critical Analysis  Etisalat-Zain Deal Blocked  337 Research Exercise  337 4 The Organization System  13 Foundations of Organizational Structure  341 What Is Organizational Structure?  342 Work Specialization  342  •  Departmentalization  343  •  Chain of Command  344  •  Span of Control  345  •  Centralization and Decentralization  346  •  Formalization  346 Common Organizational Designs  347 The Simple Structure  348  •  The Bureaucracy  348  •  The Matrix Structure  350 New Design Options  351 The Virtual Organization  351  •  The Boundaryless Organization  353 Why Do Structures Differ?  354 Strategy  355  •  Organization Size  355  •  Technology  356  •  Environment  357 Organizational Designs and Employee Behavior  358 Global Implications  360 Summary and Implications for Managers  361 Self-Assessment Library  Do I Like Bureaucracy?  342 Self-Assessment Library  How Willing Am I to Delegate?  346 A01_ROBB9658_15_SE_FM.indd 22 7/31/12 5:48 PM
  24. 24. Contents xxiii OB in the News  Siemens Simple Structure—Not  347 International OB  Structural Considerations in Multinationals  349 Point/Counterpoint  Downsizing Improves Organizational Performance  362 Questions for Review  362 Discussion Exercise  363 Ethical Considerations  363 Critical Analysis  Organizational Structure at Food Co.  363 Research Exercise  363 14 Organizational Culture  365 Institutionalization: A Forerunner of Culture  366 What Is Organizational Culture?  367 A Definition of Organizational Culture  367  •  Culture Is a Descriptive Term  367  •  Do Organizations Have Uniform Cultures?  368  •  Strong versus Weak Cultures  369  •  Culture versus Formalization  369 What Do Cultures Do?  370 Culture’s Functions  370  •  Culture as a Liability  371 Creating and Sustaining Culture  372 How a Culture Begins  372  •  Keeping a Culture Alive  373  •  Summary: How Cultures Form  375 How Employees Learn Culture  376 Stories  376  •  Rituals  376  •  Material Symbols  376  •  Language  377 Creating an Ethical Organizational Culture  378 Creating a Positive Organizational Culture  379 Spirituality and Organizational Culture  380 What Is Spirituality?  380  •  Why Spirituality Now?  380  •  Characteristics of a Spiritual Organization  381  •  Criticisms of Spirituality  382 Global Implications  383 Summary and Implications for Managers  383 Self-Assessment Library  What’s the Right Organizational Culture for Me?  366 International OB  Managing Across Organizational Boundaries  370 OB in the News  Change Jobs, and You May Be in for a Culture Shock  377 Self-Assessment Library  How Spiritual Am I?  381 Point/Counterpoint  Organizational Cultures Can’t Be Changed  385 Questions for Review  385 Discussion Exercise  386 Ethical Considerations  386 Critical Analysis  Ghosn Turns Nissan Around  386 Research Exercise  387 A01_ROBB9658_15_SE_FM.indd 23 7/31/12 5:48 PM
  25. 25. xxiv Contents 15 Human Resource Policies and Practices in the Arab World  389 Human Resource Management Societies  391 The Recruitment Process  392 Selection Practices  393 How the Selection Process Works  393  •  Initial Selection  394  •  Substantive Selection  394  •  Contingent Selection  395 Training and Development Programs  396 Types of Training  397  •  Training Methods  398  •  Individualizing Formal Training to Fit the Employee’s Learning Style  399  •  Evaluating Effectiveness of Training Programs  399 Performance Evaluation  401 Purposes of Performance Evaluation  401  •  What Do We Evaluate?  402  •  Who Should Do the Evaluating?  403  •  Methods of Performance Evaluation  403  •  Providing Performance Feedback  405  •  Suggestions for Improving Performance Evaluations  405 Managing Diversity in Organizations  406 Work–Life Conflicts  408  •  Diversity Training  410 Global Implications  410 Selection  410  •  Performance Evaluation  411 Summary and Implications for Managers  412 Self-Assessment Library  How Much Do I Know About HRM?  391 International OB  Cultural Training  398 OB in the News  Awareness of Human Capital From Within: ‘Project Emiratization’  400 Self-Assessment Library  How Good Am I at Giving Performance Feedback?  406 Point/Counterpoint  Telecommuting Makes Good Business Sense  414 Questions for Review  415 Discussion Exercise  415 Ethical Considerations  415 Critical Analysis  So7i Wa Sari3  415 Research Exercise  416 5 Organization Dynamics  16 Organizational Change and Stress Management  419 Forces for Change  420 Planned Change  422 Resistance to change  423 Overcoming Resistance to Change  423  •  The Politics of Change  425 A01_ROBB9658_15_SE_FM.indd 24 7/31/12 5:48 PM
  26. 26. Contents xxv Approaches to Managing Organizational Change  426 Lewin’s Three-Step Model  426  •  Kotter’s Eight-Step Plan for Implementing Change  426  •  Action Research  427  •  Organizational Development  428 Creating a Culture for Change  430 Stimulating a Culture of Innovation  430  •  Creating a Learning Organization  431 Work Stress and Its Management  433 What Is Stress?  433  •  Potential Sources of Stress  434  •  Individual Differences  436  •  Emotional Intelligence and Stress  436  •  Consequences of Stress  437  •  Managing Stress  438 Global Implications  440 Summary and Implications for Managers  441 Self-Assessment Library  How Well Do I Respond to Turbulent Change?  420 Self-Assessment Library  How Stressful Is My Life?  436 OB in the News  The Ten Most Stressful Jobs—and One More That Didn’t Make the List  437 International OB  Coping with Stress: Cultural Differences  439 Point/Counterpoint  Managing Change is an Episodic Activity  442 Questions for Review  442 Discussion Exercise  443 Ethical Considerations  443 Critical Analysis  Embracing Change Through Operational Leadership  443 Research Exercise  444 17 Organizational Behavior in the Family Business  447 What Is a Family Business?  448 Definitions of the Family Business  450  •  Statistics about the Family Business  451  •  Planning the Family Business  451  •  Organizational Structure of the Family Business  452 The Characteristics of the Family Business  454 Organizational Behavior in the Family Business  454 Family Businesses Are Dominant in the Arab World  456 The Family Business in the Arab World  457 Advantages of the Family Business  459 Disadvantages of the Family Business  460 The Succession Plan  461 How and When Should the Business Be Transferred?  461  •  Family Business Continuity  462 The Future of the Family Business  463 Global Implications  464 Summary and Implications for Managers  465 Self-Assessment Library  Am I Experiencing Work/Family Conflict?  448 OB in the News  The Family Business: The Foundation of Arab World Success  455 International OB  Globalization: The Direction of Arab Family Businesses  458 Point/Counterpoint  Is Structure Needed?  466 A01_ROBB9658_15_SE_FM.indd 25 7/31/12 5:48 PM
  27. 27. xxvi Contents Questions for Review  466 Discussion Exercise  466 Ethical Considerations  467 Critical Analysis  From London to Lebanon  467 Research Exercise  468 6 Specifics in OB  18 Intercultural Management: The Significance to Organizational Behavior  471 What Is Intercultural Management?  472 Hofstede’s Cultural Dimensions  473  •  Hofstede’s Dimensions and the Arab World  474  •  Managing Diversity  474 What Do Intercultural Managers Do?  474 Intercultural Managers’ Competencies  474  •  Cultural Awareness Framework  476  •  The Intercultural Manager as a Problem Solver  477  •  The Intercultural Manager as a Negotiator  478 The Significance of Communication for the Intercultural Manager  479 High versus Low Culture Contexts  480  •  How to Enhance Communication  481 The Intercultural Manager as Global Manager  482 Corporate Culture  484  •  Foreign Labour  484 Domains of International Business Practice  485 Cross-Cultural Training  485 Global Implications  486 Summary and Implications for Managers  487 Self-Assessment Library  Am I Well-Suited for a Career as a Global Manager?  472 OB in the News  Yahoo! Talks Arabic; Maktoob Talks English!  481 International OB  Intercultural Action at Hillcrest!  483 Point/Counterpoint  “When in Rome, Do as the Romans Do”  488 Questions for Review  488 Discussion Exercise  488 Ethical Considerations  489 Critical Analysis  What’s Trust Got to Do with It?  489 Research Exercise  490 A01_ROBB9658_15_SE_FM.indd 26 7/31/12 5:48 PM
  28. 28. Contents xxvii 19 Female Entrepreneurs in the Arab World  491 The Need for Women in the Workplace  492 Characteristics of Entrepreneurs  492  •  Growth of Women-Owned Businesses in the Arab World  493 The Role of Women in Business  494 The Female Entrepreneur in the Arab World  495 Motivation  497 Successful Female Entrepreneurs  497 The Barriers for Women in the Arab World  498 Low Income  499  •  Glass Ceiling  500  •  Gender Discrimination  500  •  Time Shifts  500  •  Nepotism  500  •  Other Challenges  501 How Do Males React to Successful Females?  502 Stereotypes Can Be Broken: Time for Change  503 Global Implications  504 Summary and Implications for Managers  505 Self-Assessment Library  What Are My Gender Role Perceptions?  492 International OB  The World Supports the Middle Eastern Woman  501 OB in the News  Female Leaders in Business  503 Point/Counterpoint  Females Can Find a Balance  506 Questions for Review  506 Discussion Exercise  506 Ethical Considerations  507 Critical Analysis  No Matter What, the Boardroom Is Still Off Limits to Females!  507 Research Exercise  508 Appendix A   Research in Organizational Behavior  509 Comprehensive Cases  516 Case 1 Being Lean, Not Mean  516 Case 2 She Loves a Challenge!  518 Case 3 A New Way to Change  520 Case 4 What a Strange Man!  521 Case 5 A Question of Motivation  523 Case 6 The Big Promotion  524 Credits  527 Endnotes  528 Glossary  570 Index  582 A01_ROBB9658_15_SE_FM.indd 27 7/31/12 5:48 PM
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  30. 30. xxix Foreword This book has been the world’s No. 1 best-selling organizational behavior text- book for nearly three decades. It has sold in excess of three million copies, been translated into 10 different languages, and has adapted editions published for Europe, Canada, Australia, South Africa, and the Philippines. It is with great pride that we introduce this Arab World Edition. I think you will find this book will provide the latest research in organiza- tional behavior, written in an interesting and conversational style, with exam- ples that make it relevant to Arab World students. Most importantly, this book will provide you with the relevant knowledge and skills needed for managing and working with people in diverse organizations. Stephen P. Robbins, Ph.D. and Timothy A. Judge, Ph.D. A01_ROBB9658_15_SE_FM.indd 29 7/31/12 5:48 PM
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  32. 32. xxxi Welcome to the first Arab World Edition of Organizational Behavior! Pearson has pioneered this project with the aim of highlighting the practices of organiza- tional behavior in organizations within the Arab world. This edition is addressed to both undergraduate and graduate students of the region, with the goal of making relevant research come alive for students. This textbook covers several themes and topics that are related to organizational behavior in general and in particular to organizational behavior in the Arab world. While maintaining many of the hallmark features, we have also introduced new features. These special features will enable you to understand certain issues much better, and also provide a smooth transition from one chapter to another. The writing style, level of English, and pedagogy have been carefully considered to meet the needs of students in the Arab world. The most significant aspect of this edition is the introduction of many ex- amples, cases, incidents, and illustrations talking about people, companies, and organizations that are well known in both the industry and services domain throughout the Arab world. Examples are taken from the Gulf Cooperation Council (GCC), the Levant, North Africa, Turkey, and Cyprus. This Arab World Edition reflects the attitudes and behavioral patterns of employers and em­ ployees in many of the prominent organizations across the Arab world, while examples from other countries provide a global context. Organization Part 1 introduces the concept of organizational behavior (OB). It looks at the skills that managers need to be successful and to get the job done. It also explains the various disciplines of OB as well as the challenges and opportunities it presents to both employers and employees. Part 2 speaks about individuals and how they should behave within the organization by explaining the reasons why people behave in certain ways. This part looks at the personality, values, attitudes, emotions, and moods of indi- viduals. Once we understand these, we can identify how to satisfy and motivate people for greater productivity. Part 3 deals with group behavior by explaining the importance of working in teams. We must realize that leaders need excellent communication skills to interact with different types of people. The other organizational issues covered in this section are power, politics, conflict, and negotiation. Part 4 covers the basics of organizational structure and corporate culture. In addition, it explains the HR policies and practices that are practiced in the Arab world. Part 5 speaks about organizational dynamics by looking at the challenges of change and stress, and the nature of the family business which is common in the Arab world. Finally, Part 6 looks at intercultural management and how it affects organ­ izational behavior. It also addresses the role that women are starting to play in business and how they are contributing to organizational behavior. Preface A01_ROBB9658_15_SE_FM.indd 31 7/31/12 5:48 PM
  33. 33. xxxii Preface Key Changes to the Arab World Edition Arab World Cases and Trends Each chapter has been carefully adapted to include regional case studies and examples, connecting the theory of organizational behaviour with real Arab companies and people that students will be able to relate to. These include: Opening Vignettes l The Strength of General Electric in the Arab World (Chapter 1) l What Do Arabs Think About Arabs? (Chapter 4) l Facebook Dominates in the Arab World (Chapter 9) l Al-Wasta (Chapter 11) l Aramex—Empowerment Through Organizational Structure (Chapter 13) l The Culture at Arab World Companies (Chapter 14) l Human Resource Policy at Azadea (Chapter 15) l Family Business Success Stories from the Region: The Habtoor Empire (Chapter 17) l A Sheikha and a Queen (Chapter 19) Critical Analyses l Equal opportunity at Crepaway (Chapter 1) l Qatar: A Country with a Vision (Chapter 2) l Job satisfaction in the UAE (Chapter 3) l Team Effectiveness in Egypt (Chapter 8) l Etisalat-Zain Deal Blocked (Chapter 12) l Organizational Structure at Food Co. (Chapter 13) l So7i Wa Sari3 (Chapter 15) l From London to Lebanon (Chapter 17) Photo Cases l Saudi Aramco (Chapter 1) l Qatari Business Women’s Forum (Chapter 2) l Etihad Airways (Chapter 6) l Mobinil (Chapter 9) l SABIC (Chapter 9) l Sheikh Zayad bin Sultan Al Nahayan (Chapter 10) l Qatar International Islamic Bank (QIIB) (Chapter 12) l Etisalat (Chapter 13) l Ritz Carlton, Oman (Chapter 14) l The Tharawat Family Business Forum (Chapter 17) New Features l Two new features—What Do You Think? and Picture This—allow students to get more involved in the process and interact in class. l End-of-chapter features have been changed to Discussion Exercise, Ethical Considerations, Critical Analysis and Research Exercise. These hands-on, in-class exercises are included in each chapter, along with material in the Instructor’s Manual that will make for unique and entertaining exercises to highlight a key chapter concept. l OB in the News, International OB and Point/CounterPoint features have been adapted to include examples from the Arab region. l The Arab World Edition benefits from the addition of an English–Arabic glossary for quick, easy reference, and to aid students’ understanding of key terms throughout the book. A01_ROBB9658_15_SE_FM.indd 32 7/31/12 5:48 PM
  34. 34. Preface xxxiii New Chapters The Arab World Edition contains three brand new chapters on topics that are particularly relevant to this part of the world: l Organizational Behavior in the Family Business (Chapter 17). l Intercultural Management: The Significance to Organizational Behavior (Chapter 18). l Female Entrepreneurs in the Arab World (Chapter 19). Teaching and Learning Support Mymanagementlab ( is an easy- to-use online tool that personalizes course content and provides robust assess- ment and reporting to measure student and class performance. All the resources you need for course success are in one place—flexible and easily adapted for your course experience. Resources include a Pearson eText (an eBook version of all chapters), quizzes, personalized study plans, video clips, and PowerPoint presentations, all of which engage students while helping them to study independently. In particular, mymanagementlab supports more active learning styles, involving students as they study management and prepare for tests and quizzes. Mymanagementlab also contains key video, testing, and other support resources that offer instructors many ways to enliven their classroom and save time—all in one convenient place. Instructor’s Resource Center At, instructors can access a variety of print, digital, and presentation resources available with this text in downloadable format. Registration is simple and gives you immediate access to new titles and new editions. As a registered faculty member, you can download resource files and receive immediate access and instructions for installing course management content on your campus server. If you need assistance, our dedicated technical support team is ready to help with the media supplements that accompany this text. Visit for answers to frequently asked questions, and toll-free user support phone numbers, and live chat support. The following fully adapted supplements are available to adopting instructors: l Instructor’s Manual—Provides ideas and resources in the classroom l Test Item File—Revised and updated from previous editions to include Arab examples, the test item file contains over 2,500 questions that require students to apply what they have read in the text. Questions are also tagged to reflect the AACSB Learning Standards. l TestGen Test Generating Software—Test management software containing all the material from the Test Item File. This software is completely user friendly and allows instructors to view, edit, and add test questions with just a few mouse clicks. l PowerPoint Slides—Ready-to-use PowerPoint presentations designed for classroom presentation. Use them as they are, or edit content to fit your individual classroom needs. A01_ROBB9658_15_SE_FM.indd 33 7/31/12 5:48 PM
  35. 35. xxxiv Preface Self-Assessment Library (S.A.L.) A hallmark of the Robbins series, S.A.L. is a unique learning tool that allows you to assess your knowledge, beliefs, feelings, and actions in regard to a wide range of personal skills, abilities, and interests. Self-assessments have been integrated into each chapter, including a self-assessment at the beginning of each chapter. S.A.L. helps students better understand their interpersonal and behavioral skills as they relate to the theoretical concepts presented in each chapter. Highlights l 67 research-based self-assessments—Our entire collection of 67 instru- ments are from sources such as Journal of Social Behavior and Personality, Harvard Business Review, Organizational Behavior: Experiences and Cases, Journal of Experimental Education, Journal of Applied Measurement, and others. l Work–life and career focused—All self-assessments are focused to help indi- viduals better manage their work lives or careers. Organized in four parts, these instruments offer you one source from which to learn more about yourself. l Online—The Self-Assessment Library is available online via MyManagementLab. l Save feature—Students can take the self-assessments an unlimited number of times, and save and print their scores for class discussion. l Scoring key—The key to the self-assessments has been edited by Steve Robbins to allow students to quickly make sense of the results of their score. l Instructor’s manual—An Instructor’s Manual guides instructors in interpret- ing self-assessments and helps facilitate better classroom discussion. A01_ROBB9658_15_SE_FM.indd 34 7/31/12 5:48 PM
  36. 36. xxxv Getting this book into your hands was a team effort. It took faculty reviewers and a talented group of designers and production specialists, editorial personnel, and marketing and sales staff. Foremost, I want to thank Stephen P. Robbins and Timothy A. Judge for giving the framework of this pioneer project. I want to salute the genuine contributions, support and cooperation received from the Pearson team: Sophie Bulbrook, Senior Development Editor, and Rasheed Roussan, Acquisitions Editor. Sincere gratitude goes to Fay Gibbons, Editor, for her patience. I would also like to thank Francois S. Hasham and Nafez H. Shahin, for their continuous moral support. Instructors from the Arab world reviewed all chapters in this edition and their comments, compliments, and suggestions have significantly improved the final product. I’d like to extend my sincerest thanks to the following: Acknowledgments Mohammed A. Al-Waqfi, United Arab Emirates University Dr. Tamer A. Awad, University College of Bahrain Eman Azmi, King Saud University Dr. Shaju George, Royal University for Women, Bahrain Dr. Adnan Iqbal, Prince Sultan University James T. Kunnanatt, United Arab Emirates University Dr. Penny MacDonald, American University of Kuwait Muhammad A. Malallah, University of Jordan Samer Nakhle, University of Fribourg Adel Rayan, Assiut University, Egypt Nihad Shaker Sakallah, Prince Mohammad Bin Fahd University Additional appreciation goes to all those who contributed material and allowed me to feature cases about them or their companies in this book: Rev. Father Ziad Antoun, Notre Dame University, Lebanon Charbel Aoun, Attorney Nadine Fayad Comair, FOCUS Magazine Kamal Comair, INDEVCO Eric Davoine, University of Fribourg Musa Freiji, Tanmia Bchara Ghawi, So7i Wa Sari3 Amal Harb, Rotana Walid Harb, Tannourine Hospital Anthony S. Hasham, Australian Lebanese Design Services Reine Jabre, So7i Wa Sari3 Olga Kampaxi, Rotana Marwan Kanaan, Zaatar w Zeit Carol-Ann Goff Kfouri, Notre Dame University Claire Kfouri, Engineer The Menhem Family, Damco Joseph Mghames, Azadea Farid Muna, MEIRC Gisele Nacouzi, INDEVCO Samer Nahkle, University of Fribourg Maroun Nassar, Rotana Fay Niewiadomski, ICTN Bassem Sleiman, London Taxi Nelly Sleiman, London Taxi Khaled Tayyara, Zaatar w Zeit Hani Tuffaha, Aramex Monique Bassila Zaarour, So7i Wa Sari3 Finally, this text would not have been possible without the many contributions of reviewers, consultant board members, and accuracy checkers in previous editions. I’d like to thank them all for their valuable insight and suggestions. Elham Hasham A01_ROBB9658_15_SE_FM.indd 35 7/31/12 5:48 PM
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  38. 38. 256 1 Define leadership and contrast leadership and management. 2 Summarize the conclusions of trait theories. 3 Identify behavioral theories and their main limitations. 4 Assess contingency theories of leadership by their level of support. 5 Understand the significance of leader–follower participation. 6 Define charismatic leadership and show how it influences followers. 7 Contrast transformational leadership and transactional leadership and discuss how transformational leadership works. 8 Define authentic leadership and show why ethics and trust are vital to effective leadership. 9 Demonstrate the importance of mentoring, self-leadership, and virtual leadership to our understanding of leadership. 10 Determine the challenges that leaders face. 11 Explain how to find and create effective leaders. 12 Assess whether charismatic and transformational leadership generalize across cultures. Learning Objectives This chapter will enable you to: M10_ROBB9658_15_SE_C10.indd 256 7/31/12 6:47 PM
  39. 39. 257257 Visionary Leaders at Meirc Training Consulting Leadership 10 F ounded in Lebanon in 1958 by the late Simon Siksek, Meirc Training Consulting is one of the leading providers of management train- ing and consulting to organizations throughout the Arab world. The original Middle East Industrial Relations Counselors (Meirc) was sponsored by what were then the four major oil companies in the GCC countries: Saudi Aramco, Bahrain Petroleum Company, Qatar Petroleum Company, and Kuwait Oil Company. Meirc’s raison d’être was to provide up-to-date advice on industrial relations, which later became known as human resources. Gradually, Meirc started serving all types of organizations in all types of industries, in the Middle East and beyond. Values Under the effective leadership of the late Mr. Siksek, the company’s culture emphasized specific work ethics and values, including commitment to excel- lence, and quality of products and services. Siksek also stressed integrity, innovation, teamwork, and the con- cept of a ‘Meirc family.’ Each of the five chairmen and managing directors who succeeded him embraced the same set of values and company culture. The current chairman, Dr. Farid A. Muna, continues the legacy and demonstrates extreme competencies that allow him to be successful. Muna appreciates the importance of the people who work with him and respects their qualifications. More significantly, he gives individuals the opportunity to prove their potential and allows them to grow with and for the organization. Vision Mr. Siksek’s original mission was, “To serve the human resourcesofourregion.” Thisvisionarystatementevolved overtheyearsandiscurrentlydescribedbythesesimple, yet powerful, words: “Cultivating professional com­ petence and providing effective business and human capital solutions.” In order to accomplish this vision, Meirc had to work hard, continuously and patiently, to maintain and sustain unique competitive advantages that are difficult for their competitors to copy. Meirc still works relentlessly on several strategic fronts such as people, research, and succession planning. Great leaders always focus on others, not on themselves. They hire the right people, train them, trust them, respect them, listen to them, and make sure to be there for them. As a result, they get committed people who work hard and give their best because they feel involved, appreciated, and proud of what they do.  —Lee Cockerell 257 M10_ROBB9658_15_SE_C10.indd 257 7/31/12 6:47 PM
  40. 40. 258 CHAPTER 10     Leadership People Farid Muna stresses that Meirc takes seriously the say- ing that “people are our greatest asset,” and that it can take Meirc a long time (sometimes years) before the right talent is hired. Consultants normally have sig­nificant managerial experience—it is much more effective to teach management skills if one has the hands-on experience of a manager. Additionally, most of Meirc’s con­sultants are multicultural by education or work experience: they have studied or worked in the West, and thus know what works well in the Middle East and what does not. Finally, Meirc strongly believes in the saying that“learning takes place from the cradle to the grave,” and demonstrates it by continu- ally investing in the development of its employees. Research Inspired by the words and actions of Meirc’s founder, Farid Muna continues to promote the practice of con- What’s My Leadership Style? In the Self-Assessment Library (available online) take assessment II.B.1 (What’s My Leadership Style?) and answer the following questions: 1. How did you score on the two scales? 2. Do you think a leader can be both task-oriented and people-oriented? Do you think there are situations in which a leader has to make a choice between the two styles? 3. Do you think your leadership style will change over time? Why or why not? As we read in the opening case, Siksek and Muna both demonstrated effective leadership through their display of respect and profession- alism. In addition, they believed in their vision and were single- minded in their determination to ensure that Meirc Training Consulting became the leading provider of management training and consulting to organ­ izations throughout the Arab world. This chapter will discuss all the issues that contri­bute to effective leadership. To assess yourself on another set of qualities that we’ll discuss shortly, take the following self-assessment. ducting field research and the subsequent publication of its findings. Muna understands that to remain effec- tive as a leader, one must stay abreast of the latest theories and practices to enhance the employer– employee relationship. Among the several books sponsored by Meirc are Manpower and Oil in Arab Countries (1960); The Arab Executive (1980); and Developing Multicultural Leaders: The Journey to Leadership Success (2011). Succession Planning Critical to the success of Meirc was the well-planned succession of its own managing directors. Under Farid Muna’s consultative style of leadership, the top execu- tives at Meirc established an effective process for succession planning, which should serve the firm for years to come. Source:CasecontributedbyDr.FaridA.Muna,Chairman,MeircTrainingConsulting. M10_ROBB9658_15_SE_C10.indd 258 7/31/12 6:47 PM
  41. 41. What Is Leadership? 259 In this chapter, we’ll look at the basic approaches to determining what makes an effective leader and what differentiates leaders from nonleaders. First, we’ll present trait theories, which dominated the study of leadership up to the late 1940s. Then we’ll discuss behavioral theories, which were popular until the late 1960s. Next, we’ll introduce contingency theories and interactive theories. Thereafter, we will move on to the issues in leadership such as styles and characteristics in general, and in the Arab world in particular. But before we review any of these, let’s first clarify what we mean by the term leadership. What Is Leadership? Leadership and management are two terms that are often con- fused. What’s the difference between them? John Kotter of the Harvard Business School argues that management is about coping with complexity.1 Good man- agement brings about order and consistency by presenting formal plans, designing organization structures, and monitoring results against the plans. Leadership, in contrast, is about coping with change. Leaders establish direction by developing a vision of the future; then they align people by communicating this vision and inspiring them to overcome obstacles. Management consists of implementing the vision and strategy provided by leaders, coordinating and staffing the organization, and handling day-to-day problems. We define leadership as the ability to influence a group toward the achieve- ment of a vision or set of goals. The source of this influence may be formal, such as that provided by the possession of managerial rank in an organization. Because management positions come with some degree of formally designated authority, individuals may assume a leadership role because of the position held in the organization. However, not all leaders are managers, nor are all man­ agers leaders. However, leaders can emerge from within a group, as well as by formal appointment, to lead a group. 1 Define leadership and contrast leadership and management. Carlos Ghosn is multi-cultural and multi-lingual, and has made a great impact as a leader at Michelin Tyres, Renault, and Nissan. In addition to his vision, he has impressive leadership traits, which include respect, diversity tolerance, transparency, and charisma. He is able to establish rapport with employees from all levels of the hierarchy. He considers that the key to success in any career is understanding, and choosing, what you love to do. Leadership The ability to influence a group toward the achievement of a vision or set of goals. M10_ROBB9658_15_SE_C10.indd 259 7/31/12 6:47 PM
  42. 42. 260 CHAPTER 10     Leadership In brief, organizations need strong leadership and strong management for optimal effectiveness. In today’s dynamic world, we need leaders to challenge the status quo, to create visions of the future, and to inspire organizational members to want to achieve the visions, just as Simon Siksek did in the opening case. We also need managers to formulate detailed plans, create efficient organizational structures, and oversee day-to-day operations. Trait Theories Throughout history, strong leaders such as Napoleon, Gamal Abdel Nasser, and Winston Churchill have been described in terms of their traits with adjectives like confident, strong- willed, determined, charismatic, and decisive. Trait theories of leadership differentiate leaders from nonleaders by focusing on personal qualities and characteristics. Individuals are recognized as leaders and described in terms such as charismatic, enthusiastic, and courageous. The search for personality, social, physical, or intellectual attributes that would describe leaders and differentiate them from nonleaders goes back to the earliest stages of leadership research. Researchers began organizing traits around the Big Five personality frame- work that was discussed in Chapter 2.2 It then became clear that most of the dozens of traits emerging in various leadership reviews could be found under one of the Big Five and this approach resulted in consistent and strong support for traits as predictors of leadership. For instance, ambition and energy—two common traits of leaders—are part of extraversion. Rather than focus on these two specific traits, it is better to think of them in terms of the more general trait of extraversion. Conscientiousness and openness to experience also showed strong and con- sistent relationships to leadership, though not quite as strong as extraversion. The traits of agreeableness and emotional stability weren’t as strongly correlated with leadership. Overall, it does appear that the trait approach does have some- thing to offer. In other words, leaders who are extraverted (individuals who like being around people and are able to assert themselves), conscientious (individuals who are disciplined and keep commitments they make), and open (individuals who are creative and flexible) do seem to have an advantage when it comes to leadership, suggesting that good leaders do have key traits in common. What Do You Think? Do you have the characteristics and traits of a good leader? Do you feel you have had them from birth or did you learn them? Moreover, recent studies are indicating that another trait that may indicate effective leadership is emotional intelligence (EI), which we discussed in Chapter 6. Supporters of EI argue that without it, a person can have outstand- ing training, a highly analytical mind, a compelling vision, and an endless supply of terrific ideas, but still not make a great leader. But why is EI so critical to effective leadership? A core component of EI is empathy. Empathetic or sensitive leaders can understand others’ needs, listen to what followers say (and don’t say), and are able to read the reactions of others. As one leader noted, “The caring part of empathy, especially for the people with whom you work, is what inspires people to stay with a leader when the going gets rough. The mere fact that someone cares is more often than not rewarded with loyalty.”3 Trait theories of leadership Theories that consider personal qualities and characteristics that differentiate leaders from nonleaders. 2 Summarize the conclusions of trait theories. M10_ROBB9658_15_SE_C10.indd 260 7/31/12 6:47 PM
  43. 43. Behavioral Theories 261 Consequently, we offer two conclusions. First, traits can predict leadership and the Big Five seems to have supported that. Second, traits do a better job at predicting the emergence of leaders and the appearance of leadership than in actually distinguishing between effective and ineffective leaders.4 Behavioral Theories The discrepancies of early trait studies led researchers to start looking at the behaviors exhibited by specific leaders. They wondered if there was something different in the way that effective leaders behave. Many leaders have been very successful in leading their companies through difficult times.5 And they have relied on a common leadership style that is tough-talking, intense, and autocratic. Does this suggest that autocratic behavior is a preferred style for all leaders? In this section, we look at three different behavioral theories of leadership to answer that question. First, however, let’s consider the practical implications of the behavioral approach. If the behavioral approach to leadership were successful, it would have implications quite different from those of the trait approach. Trait research provides a basis for selecting the ‘right’ persons to assume formal positions in groups and organizations requiring leadership. In contrast, if behavioral studies were to turn up critical behavioral determinants of leadership, we could train people to be leaders. The difference between trait and behavioral theories, in terms of application, lies in their underlying assumptions. Trait theories assume that leaders are born rather than made. However, if there were specific behaviors that identified leaders, then we could teach leadership; we could design programs that implanted these behavioral patterns in individuals who desired to be effective leaders. OB in the News Riding the Waves Requires Leadership Skill! T he extraordinary competence, vision, and leadership skills of the Governor of the Central Bank of Lebanon, Mr. Riad Salameh, enabled Lebanon to be less affected by the 2008 global financial crisis. It managed to stay abreast of the emergency and, thus, was not negatively influenced by the monetary turbulence. Salameh’s keen observations and awareness of the local, regional, and international economy allowed him to lead the banking sector through those threatening times: As of November 26, 2008, Central Bank Governor Riad Salameh announced that the combined assets of Lebanese banks totaled over US$100 billion—four times the country’s GDP. Lebanese bankers agree that the central bank takes pride in shying away from complex investments and structured products that it does not understand. Despite the severe challenges of the economic downturn worldwide, the Lebanese banking sector has demonstrated resiliency and dynamism, apparently weathering the storm. Whilst international markets were struggling with the credit crunch and the high interbank interest rates of October 2008, Lebanese banks acted proactively in lending their ample liquidity to foreign financial institutions, and gaining high returns As a result of Salameh’s leadership and his ability to guide the banking sector to safe shores, his position as Central Bank Governor was once again renewed in 2011. Sources: M. Mikhael, “Lebanon Basks in the Calm Eye of the Financial Storm,” Executive Magazine, Issue No. 114 (2009); “Lebanon—Banked for the Storm,” Executive Magazine, Issue No. 115 (2009). 3 Identify behavioral theories and their main limitations. Behavioral theories of leadership Theories proposing that specific behaviors differentiate leaders from nonleaders. M10_ROBB9658_15_SE_C10.indd 261 7/31/12 6:47 PM
  44. 44. 262 CHAPTER 10     Leadership Ohio State Studies The most comprehensive of the behavioral theories resulted from research that began at Ohio State University, in the US, in the late 1940s.6 Researchers wanted to identify independent dimensions of leader behavior and narrowed the list to two categories that were responsible for most of the leadership behavior described by employees. They called these two dimensions initiating structure and consideration. Initiating structure refers to the extent to which leaders define and structure their role and those of employees in the search for goal attainment. It includes behavior that attempts to organize work, work relationships, and goals. A leader characterized as high in initiating structure could be described as someone who ‘assigns group members to particular tasks, expects workers to maintain definite standards of performance, and emphasizes the meeting of deadlines.’ Consideration is described as the extent to which individuals are likely to have job relationships that are characterized by mutual trust, respect for employees’ ideas, and regard for their feelings. We could describe a leader high in consideration as one who helps employees with personal problems, is friendly and approachable, treats all employees as equals, and expresses appreciation and support. University of Michigan Studies Leadership studies undertaken in the US at the University of Michigan’s Survey Research Center at about the same time as those being done at Ohio State had similar research objectives: to locate behavioral characteristics of leaders that appeared to be related to measures of performance effectiveness. The Michigan group also came up with two dimensions of leadership behavior that they labeled employee oriented and production oriented.7 The employee-oriented leaders were described as emphasizing interpersonal relations; they took a personal interest in the needs of their employees and accepted individual differences among members. The production-oriented leaders, in contrast, tended to emphasize the technical or task aspects of the job; their main con- cern was in accomplishing their group’s tasks, and the group members were a means to that end. The conclusions the Michigan researchers arrived at strongly supported the leaders who were employee-oriented in their behavior. Employee-oriented leaders were associated with higher group productivity and greater job satis­ faction. Production-oriented leaders tended to be associated with low group productivity and lower job satisfaction. Referring to both the Ohio State and Michigan studies, Robert R. Blake and Jane S. Mouton designed a managerial grid (sometimes called the leadership grid) based on the styles of concern for people and concern for produc­tion, which essentially represent the Ohio State dimensions of con­sideration and initiating structure or the Michigan dimensions of employee oriented and production oriented.8 The grid, shown in Figure 10-1, has 9 possible positions along each axis, creat- ing 81 different positions in which the leader’s style may fall. The grid does not show results produced; rather, it shows the dominating factors in a leader’s thinking in regard to getting results. Based on the findings of Blake and Mouton, managers were found to perform best under a 9,9 style, as contrasted, for example, with a 9,1 (authority type) or 1,9 (laissez-faire or flexible type) style.9 Summary of Trait Theories and Behavioral Theories Judging from the evidence, the behavioral theories, like the trait theories, add to our understanding of leadership effectiveness. Leaders who have certain Initiating structure The extent to which a leader is likely to define and structure his or her role and those of subordinates in the search for goal attainment. Consideration The extent to which a leader is likely to have job relationships characterized by mutual trust, respect for subordinates’ ideas, and regard for their feelings. Employee-oriented leader A leader who emphasizes interpersonal relations, takes a personal interest in the needs of employees, and accepts individual differences among members. Production-oriented leader A leader who emphasizes technical or task aspects of the job. Managerial grid A nine-by-nine matrix outlining 81 different leadership styles. M10_ROBB9658_15_SE_C10.indd 262 7/31/12 6:47 PM
  45. 45. Contingency Theories: Fiedler Model and Situational Leadership Theory 263 traits and who display consideration and structuring behaviors, do appear to be more effective. We should remember, however, that as important as trait theories and behavioral theories are in determining effective versus ineffective leaders, they do not guarantee a leader’s success. The context matters too. Contingency Theories: Fiedler Model and Situational Leadership Theory Predicting leadership success is more complex than isolat- ing a few traits or preferable behaviors. In the mid-twentieth century, many researchers were unable to obtain consistent results on traits and behaviors as predictors for leadership success, and this led to a focus on situational influences. The relationship between leadership style and effectiveness suggested that under condition a, style x would be appropriate, whereas style y would be more suitable for condition b, and style z would be more suitable for condition c. But what were the conditions a,b,c and so forth? It was one thing to say that leader- ship effectiveness was dependent on the situation and another to be able to isolate those situational conditions. Several approaches to isolating key situ­ ational variables have proven more successful than others and, as a result, have gained wider recognition. We shall consider three of these: the Fiedler model, Hersey and Blanchard’s situational theory, and the path-goal theory. Fiedler Model The first comprehensive contingency model for leadership was developed by Fred Fiedler.10 The Fiedler contingency model proposes that effective group performance depends on the proper match between the leader’s style and the degree to which the situation gives control to the leader. 4 Assess contingency theories of leadership by their level of support. Fiedler contingency model The theory that effective groups depend on a proper match between a leader’s style of interacting with subordinates and the degree to which the situation gives control and influence to the leader. Figure 10-1  The Managerial Grid M10_ROBB9658_15_SE_C10.indd 263 7/31/12 6:47 PM
  46. 46. 264 CHAPTER 10     Leadership Defining the Situation  After an individual’s basic leadership style has been assessed through the LPC questionnaire, it is necessary to match the leader with the situation. Fiedler has identified three dimensions that define the key situational factors that determine leadership effectiveness: 1. Leader–member relations is the degree of confidence, trust, and respect members have in their leader. 2. Task structure is the degree to which the job assignments are procedurized (that is, structured or unstructured). 3. Position power is the degree of influence a leader has over power variables such as hiring, firing, discipline, promotions, and salary increases. The next step in the Fiedler model is to evaluate the situation in terms of these three contingency variables. Leader–member relations are either good or poor, task structure is either high or low, and position power is either strong or weak. Matching Leaders and Situations  How would you apply Fiedler’s findings? You would seek to match leaders and situations. Individuals’ LPC scores would determine the type of situation for which they are best suited. That ‘situation’ would be defined by evaluating the three contingency factors of leader–member relations, task structure, and position power. But remember that Fiedler views an individual’s leadership style as being fixed. Therefore, there are really only two ways in which to improve leader effectiveness. First, you can change the leader to fit the situation; for example, a group’s performance could be improved by replacing that manager with one who is task oriented. The second alternative would be to change the situation to fit the leader. That could be done by restructuring tasks or increasing or decreasing the power that the leader has to control factors such as salary increases, promotions, and disciplinary actions. What is My LPC Score? In the Self-Assessment Library (available online) take assessment IV.E.5 (What is My LPC Score?). Identifying Leadership Style  Fiedler believes a key factor in leadership success is the individual’s basic leadership style. So he begins by trying to find out what that basic style is. Fiedler created the least preferred coworker (LPC) questionnaire to measure whether a person is task-or relationship-oriented. The LPC questionnaire contains sets of 16 contrasting adjectives (such as pleasant– unpleasant, efficient–inefficient, open–guarded, supportive–hostile). It asks respondents to think of all the coworkers they have ever had and to describe the one person they least enjoyed working with by rating that person on a scale of 1 to 8 for each of the 16 sets of contrasting adjectives. Fiedler believes that based on the respondents’ answers to this LPC questionnaire, he can determine their basic leadership style. If the least preferred coworker is described in relatively positive terms (a high LPC score), then the respondent is primarily interested in good personal relations with this coworker. That is, if you essentially describe the person you are least able to work with in favorable terms, Fiedler would label you relationship oriented. In contrast, if the least preferred coworker is seen in relatively unfavorable terms (a low LPC score), the respondent is primarily interested in productivity and thus would be labeled task oriented. To understand Fiedler’s model, take the following self-assessment exercise before we move on. Leader–member relations The degree of confidence, trust, and respect subordinates have in their leader. Task structure The degree to which job assignments are procedurized. Position power Influence derived from one’s formal structural position in the organization; includes power to hire, fire, discipline, promote, and give salary increases. Least preferred coworker (LPC) questionnaire An instrument that purports to measure whether a person is task or relationship oriented. M10_ROBB9658_15_SE_C10.indd 264 7/31/12 6:47 PM
  47. 47. Contingency Theories: Fiedler Model and Situational Leadership Theory 265 Evaluation  As a whole, reviews of the major studies that have tested the over- all validity of the Fiedler model lead to a generally positive conclusion. That is, there is considerable evidence to support only three categories rather than the original eight. But there are problems with the LPC questionnaire and the logic underlying the LPC questionnaire is not well understood. Also, the contingency variables are complex and difficult for practitioners to assess. Cognitive Resource Theory  More recently, Fiedler has reconsidered his ori­ ginal theory.11 In this refinement, called cognitive resource theory, he focuses on the role of stress as a form of situational unfavorableness and how a leader’s intelligence and experience influence his or her reaction to stress. The basis of the new theory is that stress is the enemy of rationality. It’s difficult for leaders (or anyone else, for that matter) to think logically and analytically when they’re under stress. Hersey and Blanchard’s Situational Theory Paul Hersey and Ken Blanchard have developed a leadership model that has gained a strong following among management development specialists.12 This model—called situational leadership theory (SLT)—has been incorporated into leadership training programs at more than 400 of the Fortune 500 com­ panies; and more than 1 million managers per year from a wide variety of organizations are being taught its basic elements.13 Situational leadership is a contingency theory that focuses on the followers. Successful leadership is achieved by selecting the right leadership style, which Hersey and Blanchard argue is contingent on the level of the followers’ readiness. Before we proceed, we should clarify two points: Why focus on the followers? And what do they mean by the term readiness? The emphasis on the followers in leadership effectiveness reflects the reality that it is the followers who accept or reject the leader. Regardless of what the leader does, effectiveness depends on the actions of the followers. The term readiness, as defined by Hersey and Blanchard, refers to the extent to which people have the ability and willingness to accomplish a specific task. SLT says that if followers are unable and unwilling to do a task, the leader needs to give clear and specific directions; if followers are unable and willing, the leader needs to display high task orientation to compensate for the followers’ lack of ability and high relationship orientation to get the followers to “buy into” the leader’s desires; if followers are able and unwilling, the leader needs to use a supportive and participative style; and if the employees are both able and willing, the leader doesn’t need to do much. Research efforts to support this theory have generally been disappointing, so despite its intuitive appeal, approval of this theory must be cautioned against. Path-Goal Theory Developed by Robert House, path-goal theory extracts elements from the Ohio State leadership research on initiating structure and consideration and the expectancy theory of motivation.14 The Theory  The essence of path-goal theory is that it is the leader’s job to provide followers with the information, support, or other resources necessary for them to achieve their goals. The term path-goal is derived from the belief that effective leaders clarify the path to help their followers get from where they are to the achievement of their work goals and to make the journey along the path easier by reducing roadblocks. When Home Depot hired Robert Nardelli as CEO, the company believed he was ‘the right guy’ to improve the company’s performance. Under his leadership, Home Depot’s profits, sales, and number of stores doubled. But shareholders criticized his leadership because he failed to improve the company’s stock price relative to his huge pay package. After leaving Home Depot, Nardelli was hired as ‘the right guy’ to revitalize Chrysler based on his turnaround expertise. Predicting the effectiveness of Nardelli’s leadership as CEO of Home Depot and Chrysler illustrates the premise of contingency theories that leadership effectiveness is dependent on situational influences. Cognitive resource theory A theory of leadership that states that stress unfavorably affects a situation and that intelligence and experience can reduce the influence of stress on the leader. Situational leadership theory (SLT) A contingency theory that focuses on followers’ readiness. Path-goal theory A theory that states that it is the leader’s job to assist followers in attaining their goals and to provide the necessary direction and/or support to ensure that their goals are compatible with the overall objectives of the group or organization. M10_ROBB9658_15_SE_C10.indd 265 7/31/12 6:47 PM
  48. 48. 266 CHAPTER 10     Leadership Leader Behaviors  House identified four leadership behaviors. The directive leader lets followers know what is expected of them, schedules work to be done, and gives specific guidance as to how to accomplish tasks. The supportive leader is friendly and shows concern for the needs of followers. The participative leader consults with followers and uses their suggestions before making a decision. The achievement-oriented leader sets challenging goals and expects followers to perform at their highest level. In contrast to Fiedler, House assumes leaders are flexible and that the same leader can display any or all of these behaviors, depending on the situation. What Do You Think? Can leaders show different behaviors or are they identified by one specific behavior? Path-Goal Variables and Predictions As Figure 10-2 illustrates, path-goal theory proposes two classes of contingency variables that direct the leadership behavior–outcome relationship: those in the environment that are outside the control of the employee (task structure, the formal authority system, and the work group) and those that are part of the personal characteristics of the employee (locus of control, experience, and perceived ability). For example, the following are illustrations of predictions based on path-goal theory: l Directive leadership leads to greater satisfaction when tasks are ambiguous or stressful than when they are highly structured and well laid out. l Supportive leadership results in high employee performance and satisfaction when employees are performing structured tasks. l Directive leadership is likely to be perceived as redundant among employees with high perceived ability or considerable experience. l Employees with an internal locus of control will be more satisfied with a participative style. Figure 10-2  Path-Goal Theory M10_ROBB9658_15_SE_C10.indd 266 7/31/12 6:47 PM
  49. 49. Leader–Member Exchange (LMX) Theory 267 l Achievement-oriented leadership will increase employees’ expectancies that effort will lead to high performance when tasks are ambiguously structured. Summary of Contingency Theories It is fair to say that none of the contingency theories has been as successful as their developers had hoped. In particular, results for situational leadership theory and path-goal theory have been disappointing. One limitation of many of the theories we’ve covered so far is that they ignore the followers. Yet, as one leadership scholar noted, “leaders do not exist in a vacuum;” leadership is a symbolic relationship between leaders and followers.15 But the leadership theories we’ve covered to this point have largely assumed that leaders treat all their followers in the same manner. That is, they assume that leaders use a fairly homogeneous style with all the people in their work unit. Next we look at a theory that considers differences in the relationships leaders form with different followers. Leader–Member Exchange (LMX) Theory Think of a leader you know. Did this leader tend to have favorites who made up his or her ‘in-group’? If you answered ‘yes,’ you’re acknowledging the founda- tion of leader–member exchange theory.16 The leader–member exchange (LMX) theory argues that, because of time pressures, leaders establish a special relationship with a small group of their followers. These individuals make up the in-group—they are trusted, have the leader’s attention, and are more likely to receive special privileges. Other followers fall into the out-group. They get less of the leader’s time, get fewer of the preferred rewards that the leader controls, and have leader–follower relations based on formal authority interac- tions. This is a familiar concept in the Arab world, where many leaders develop their ‘own circle’ of followers and usually only have ears for them. Just precisely how the leader chooses who falls into each category is unclear, but there is evidence that leaders tend to choose in-group members because they have demographic, attitude, and personality characteristics that are similar to the leader’s or a higher level of competence than out-group members17 (see Figure 10-3). Leader–member exchange (LMX) theory A theory that supports leaders’ creation of in-groups and out- groups; subordinates with in-group status will have higher performance ratings, less turnover, and greater job satisfaction. Figure 10-3  Leader–Member Exchange Theory M10_ROBB9658_15_SE_C10.indd 267 7/31/12 6:47 PM
  50. 50. 268 CHAPTER 10     Leadership Box 10-1 Contingency Variables in the Revised Leader-Participation Model 1. Importance of the decision 2. Importance of obtaining follower commitment to the decision 3. Whether the leader has sufficient information to make a good decision 4. How well structured the problem is 5. Whether an autocratic decision would receive follower commitment 6. Whether followers ‘buy into’ the organization’s goals 7. Whether there is likely to be conflict among followers over solution alternatives 8. Whether followers have the necessary information to make a good decision 9. Time constraints on the leader that may limit follower involvement 10. Whether costs to bring geographically dispersed members together is justified 11. Importance to the leader of minimizing the time it takes to make the decision 12. Importance of using participation as a tool for developing follower decision skills Decision Theory: Vroom and Yetton’s Leader-Participation Model The final theory we’ll cover argues that the way leaders make decisions is as important as what they decide. Victor Vroom and Phillip Yetton developed a leader-participation model that relates leadership behavior and participation in deci- sion making.18 Recognizing that task structures have varying demands for routine and nonroutine activities, these researchers argued that leader behavior must adjust to reflect the task structure. Vroom and Yetton’s model provides a sequential set of rules that should be followed in determining the form and amount of participation in decision making, as determined by different types of situations. The model is a decision tree incorporating seven contingencies (whose relevance can be identified by making ‘yes’ or ‘no’ choices) and five alternative leadership styles. The 12 contingency variables are listed in Box 10-1. Inspirational Approaches to Leadership Traditional approaches to leadership—those we considered earlier in this chapter— ignore the importance of the leader as a communicator. Framing is a way of communicating to shape meaning. It’s a way for leaders to influence how others see and understand events. Framing is especially important to an aspect of lead- ership ignored in the traditional theories: the ability of the leader to inspire others to act beyond their immediate self-interests. In this section, we present two contemporary leadership theories with a common theme. They view leaders as individuals who inspire followers through their words, ideas, and behaviors. These theories are charismatic leadership and transformational leadership. Framing A way of using language to manage meaning. 5 Understand the significance of leader– follower participation. Leader-participation model A leadership theory that provides a set of rules to determine the form and amount of participative decision making in different situations. M10_ROBB9658_15_SE_C10.indd 268 7/31/12 6:47 PM
  51. 51. Inspirational Approaches to Leadership 269 The first researcher to consider charismatic leadership in terms of OB was Robert House. According to House’s charismatic leadership theory, followers make attributions of heroic or extraordinary leadership abilities when they observe certain behaviors.19 There have been a number of studies that have attempted to identify the characteristics of the charismatic leader. One of the best reviews of the literature has documented four—vision, willingness to take personal risks to achieve that vision, sensitivity to follower needs, and behaviors that are out of the ordinary.20 These characteristics are described in Box 10-2. Charismatic Leadership John F. Kennedy, Amr Mussa, and Martin Luther King Jr. are often identified as being charismatic leaders. So what do they have in common? What Is Charismatic Leadership?  Max Weber, a sociolo- gist, was the first scholar to discuss charismatic leadership. More than a century ago, he defined charisma (from the Greek for ‘gift’) as “a certain quality of an individual personality, by virtue of which he or she is set apart from ordinary people and treated as endowed with supernatural, superhuman, or at least specifically exceptional powers or qualities.” Take the following self-assessment to see how you score on charismatic leadership. Amr Moussa is a charismatic leader. A native of Egypt, he is a former foreign minister and, until recently, was chief of the Arab League. Mussa’s visionary insights resulted in his position as head of the Arab League for two terms. His persistence in following his vision of peace in the Arab world has won him the respect of prominent international figures. Although 75, he has been suggested for a possible major role in a future Egyptian government. 6 Define charismatic leadership and show how it influences followers. How Charismatic Am I? In the Self-Assessment Library (available online), take assessment II.B.2 (How Charismatic Am I?). Charismatic leadership theory A leadership theory that states that followers make attributions of heroic or extraordinary leadership abilities when they observe certain behaviors. M10_ROBB9658_15_SE_C10.indd 269 7/31/12 6:47 PM